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When is interfering with a business contract illegal?

In Florida, interfering with business contractual relationships occurs for various reasons, such as gaining leverage in business deals or undermining a competitor’s business. When a third party tries to meddle in a business deal between two other people without a good reason, they may be breaking the law. Below is an explanation of this particular type of conduct, along with common defenses and solutions.

Tortious contract interference

Business torts generally mean that someone is accused of harming another business unlawfully. If a person interferes with a business contract, certain elements must be present to prove tortious interference. Someone must have knowingly and intentionally interfered with a business relationship or contract between two other parties, such as a sales contract between a business and its customer.

Contract interference typically involves an already established and legally binding contract or ongoing business relationship. Additionally, a third party not a part of the original contract or relationship must interfere in a manner that harms the parties involved.

Types of interference

Examples of someone interfering with a contract include persuading one party to breach their contract with another. The third-party may undercut the original contract or use other means to motivate the original party to breach the original agreement.

However, it’s also possible for the third party to prevent the performance of the contract without actually breaking it. In this situation, even though the original parties don’t break the contract themselves, they may not be able to fulfill it as agreed due to the interference of the third party.

Defenses and remedies

In certain circumstances, legitimate grounds for non-compliance with a contract may exist. It is crucial to ensure that any decision to breach an agreement is made after carefully considering all the relevant factors and is in line with the applicable laws and regulations. This reason can provide a defense against a contract interference claim. If a party is found liable for interfering with a contract, the injured party can seek legal remedies, such as suing for compensation to cover the damages caused.

Understanding the terminology behind tortious interference is vital to identifying when this wrongful action has victimized one.